How many times have I seen this question posed?
Probably about as many times as I have seen answers from newspaper columnists.
And you know what? Has everyone got it right yet? Hmmm?
Is it time for a change to your way of thinking?
Property School 101 says of the volume of properties on the market;
Actually otherwise known as “Supply and Demand.”
Could 2010 be the year you take advantage of these seasonal cycles and make it work for you?
Have you heard of the contrarian theory?
Well two famous ones/individuals spring to mind. I’ll be upfront about this though, these two do conjure up different emotions in most folks.
At no. 1 is the Sage of Omaha.
His contrarian views have made him fabulously wealthy.
…..your median priced NZ home will buy approximately 3.5 shares (based on tonights close) in his company Berkshire Hathaway, and Warren has 350,000 Class A shares!
As the worlds 2nd richest man, this is what Warren believes
Re read his number 1 point again. (click on image for larger version)
Next at number 2 we have Mr John Paulsen.
Maybe he could have slipped under the radar but for the billions he has made in the last few years, not by going with the real estate boom, but by betting against it.
How did both of these individuals achieve what they did, amass the wealth they have.
Well in both cases, they did it by taking the contrarian view.
How does this relate to Real Estate?
This chart shows the volume of sales nationwide for the last 3 years.
And this one, in a more pronounced fashion courtesy of the benefit of not being averaged out by “NZ Wide” figures”, shows the same time-frame for one of the regions, Nelson in this case. (actually it is Nelson taken out of the Nelson / Marlborough mix)
Not hard to spot a trend is it, you don’t have to be a rocket scientist to figure out that higher percentages tend to place their properties on the market in late Feb to March and then again, in spring around the Sept / Oct time-frame. (this is for our Southern Hemisphere cousins obviously) The start of spring 2008, Sept into October was not normal for the obvious reasons.
So in saying it would appear that most people are following the pack, but are they doing themselves an injustice in the process.
I was once told, in fact had it repeated just 2 months ago by another investor, that;
“…the best time to go looking was when others weren’t”
and Xmas was perfect to get a bargain according to both of these buyers.
Maybe that was from a Nelson perspective, but really if you want a premium for your $399,000 property surely wouldn’t you agree that you’d stand a better chance of getting it, if your property was the only one in the suburb with its feature-set at that time.
Considering the above headline in tonights paper, then its even more prudent that you shouldn’t want your home to be competing for buyers with 3 or 4 other similar properties in the region. Look seriously to sell at a time of the year when your home faces less competition.
Simple, just look again at the charts above.
Or you could look at it from a contrarian view too – when would be the best time to be a CASH buyer in the NZ residential property market?
At a time when there is heaps of choice, in other words………